Pennsylvania seeks health care law funding

Insurance Department applies for $33 million, but Corbett hopes to see law overturned.

January 29, 2012|By Tim Darragh, Of The Morning Call

Gov. Tom Corbett believes the Obama administration's health reform law is unconstitutional, but that's not stopping the state from asking the federal government for money to implement it.

State Insurance Commissioner Michael F. Consedine last week announced that the Insurance Department filed its application for about $33 million to complete planning and begin development and design of a health insurance exchange.

"The governor continues to believe that the law requiring the purchase of health insurance is unconstitutional," Consedine said in a statement. "However, it would not be prudent to be caught unprepared. Therefore, we must implement a solution, if necessary, by developing a plan for Pennsylvanians should the U.S. Supreme Court not strike down the law."

As attorney general, Corbett joined a multistate lawsuit challenging the constitutionality of a provision in the law requiring people to purchase insurance or face a penalty if they did not. That suit now is before the Supreme Court, which is expected to rule before the general election in November.

The exchange will be a one-stop shopping site for people looking for new health insurance, allowing them to compare rates and coverage from private insurers. Exchanges will select qualified health plans, help consumers choose a health plan and enroll in it and help determine if the consumer qualifies for a subsidized premium.

More than 1.3 million Pennsylvanians — 11 percent of the state's population — were uninsured in Pennsylvania in 2010, according to the latest data available from the Kaiser Family Foundation.

According to the law, known as the Affordable Care Act, the exchanges have to be ready by Jan. 1, 2014. The federal government will impose an exchange on states that don't create one.

The department estimates that 2 million to 2.2 million Pennsylvanians could get coverage through the exchange, although insurance department documents state that all Pennsylvanians, as potential health insurance consumers, will benefit from the establishment of the exchange. People who have health insurance through their employer would continue to receive that coverage and wouldn't have to do anything further.

Consedine said the exchange would have widespread benefits for the state.

"The grant proposal envisions a design that is market-based, enhances competition, allows for continued innovation in the marketplace and provides for ample choice of health insurance options for all Pennsylvanians," he said. "Consistent with the administration's goal of being financially responsible and improving the efficiency of state government, any exchange design should leverage existing state resources and promote the development of public-private partnerships to ensure that what is built best serves Pennsylvanians."

Twenty-eight states and the District of Columbia already have received exchange establishment grants totaling about $438 million, according to a report released last week by the White House.

Pennsylvania already has spent a $1 million federal planning grant to determine if it would move forward with the process of building the exchange.

The insurance department is listing its grant application documents on a web site: http://www.pahealthoptions.com. It also acts as a rudimentary exchange, providing some information for consumers shopping for health insurance.